Beware ‘unethical’ buyers’ agents

Jennison, who is the president of the Real Estate Buyers Agents Association of Australia (REBAA) has delivered a powerful warning to home buyers about buyer’s agents who are “clearly more interested in nabbing upfront fees from their clients and then doing to absolute minimum to fulfil the briefs”.

But in a world of flashy social media façades and deceptive marketing, it can be difficult to know which buyer’s agents will deliver a service that is more than just skin-deep.

“I recently heard of a sales agent who received a ‘shopping list’ from a volume buyer’s agent, which simply outlined the types of properties they needed to secure to satisfy the dozens of clients they were supposedly currently representing,” Jennison said.

“Buyers caught out by unethical buyer’s agents probably have no idea that the person they have already potentially given thousands of dollars to is doing very little work on their behalf.”

According to the REBAA president, there are six red flags to watch out for when choosing a buyer’s agent.

1. ‘I have dozens of clients’

Beware of buyer’s agents who boast that they service many buyers at once – this is a strong indication that they prefer large volumes of clients over quality service provision.

“One of the most important questions to ask your prospective buyer’s agent is how many buyers they currently represent because it shouldn’t be any more than four or five per agent,” said Jennison.

2. ‘One of my other clients wants that too’

Within the small pool of clients who they currently represent, the buyer’s agent should not service customers who have exactly the same brief.

“Working with clients who have the same briefs is unethical because how on earth would they determine which buyer deserves which property – unless it was influenced by who has paid the highest fee, or who is prepared to make the quickest decision,” Jennison said.

Diversity of location, budget, size, condition and property type makes for a more ethical buyer’s agent.

3. ‘All my properties are off-market’

Buyer’s agents who claim to source all of their properties off-market is “a big red flag” according to Jennison, who noted that these properties “often require a premium to be paid”.

In addition, sourcing all properties is highly unlikely, and is a sign that other claims the buyer’s agent makes may also be false.

4. ‘I’ll find your dream property within a fortnight’

“Another warning sign is if an agent promises to fulfil your property brief within a fortnight, because sometimes it can take a month or two for the ideal property to be found for your client,” said Jennison.

As with other overblown claims, time frames that seem too good to be true probably are.

5. ‘This is a once-in-a-lifetime offer’

Pressure tactics are a major warning sign for prospective clients.

Jennison warned buyers to beware any claims that create a sense of urgency, such as claims that the buyer has missed out on an off-market opportunity or a special retainer fee unless they sign up on the spot.

“Ethical buyer’s agents not only provide a high level of service to a limited number of clients, they also would never resort to cheap marketing tactics to win business,” said Jennison.

6. ‘There’s no need to check’

Finally, Jennison noted that quality buyer’s agents are “appropriately licensed in every state they buy in” and are “members of industry associations such as REBAA”.

In addition, she stated they are “more than happy for prospective clients to speak with current or former clients for objective testimonials”.